Chapter 2: Business Ethics and Social Responsibility — Vocabulary Flashcards

A vocabulary set covering key concepts, laws, principles, and issues addressed in the chapter on business ethics and social responsibility.

Business ethics

The principles and standards that determine acceptable conduct in business organizations.

Personal ethics

An individual's values, principles, and standards of conduct.

Ethical culture

The organization's shared values and norms that promote ethical behavior.

Tone at the top

Top management's visible commitment to ethics and compliance.

Ethical leadership

Leaders' actions and policies that promote integrity and compliance.

Code of ethics

Formalized rules describing expected behavior for employees.

Ethics training

Programs to educate employees about ethics policies and decision-making.

Open discussion of ethical issues

Encouraging dialogue to build trust and address risks.

Corporate citizenship

The extent to which a business meets legal, ethical, economic, and voluntary responsibilities to stakeholders.

ESG framework

Environmental, Social, Governance; a framework to evaluate sustainability and ethics.

Stakeholders

Groups affected by a company's actions (owners, employees, customers, suppliers, community, environment, etc.).

Social responsibility

A business's obligation to maximize positive social impact and minimize negative impact.

Corporate social responsibility (CSR)

A company's initiatives to contribute to societal goals beyond profit.

Four dimensions of social responsibility

Financial/economic, legal compliance, ethics, and philanthropy (voluntary).

Environmental sustainability

Conducting activities to protect the long-term health of the natural environment.

Philanthropy

Voluntary charitable activities by a firm.

Greenwashing

Deceptively presenting a product or practice as environmentally friendly.

ESG reporting

Public reporting of environmental, social, and governance metrics.

JFK consumer rights (Right to safety)

Right to be free from hazardous products and unsafe shopping conditions.

Right to be informed

Right to receive complete information about risks and instructions for use.

Right to choose

Right to access a variety of goods/services at fair prices with quality.

Right to be heard

Right to have consumer interests considered by government policy.

Bribery

Payments or gifts intended to influence a decision; illegal in many countries.

Foreign Corrupt Practices Act (FCPA)

U.S. law prohibiting bribery of foreign government officials.

Conflicts of interest

When personal interests could improperly influence professional duties.

Insider trading

Buying or selling stocks using material nonpublic information.

Time theft

Misuse of company time for non-work activities (e.g., personal browsing).

Abusive and intimidating behavior

Harassment or hostile conduct that disrupts the workplace.

Bullying

Repeated abusive behavior that creates a hostile work environment.

Sexual harassment

Unwelcome sexual advances or conduct; protected by law (EEOC).

Ombuds programs

Confidential channels for employees to resolve complaints and concerns.

Misuse of company resources

Using company assets for personal use or theft of resources.

Plagiarism

Copying someone else’s work and presenting it as one’s own.

Intellectual property

Rights protecting creations of the mind (copyrights, patents, trademarks).

Copyright

Exclusive rights to reproduce/distribute a work; duration usually lifetime + years.

Patent

Exclusive rights to an invention, typically lasting 20 years.

Trademark

A legally protected brand name, logo, or symbol.

Trade dress

Visual appearance of a product/packaging protected if strongly associated with the product.

Real property

Real estate and permanent fixtures.

Personal property

All other property; tangible vs intangible.

Tangible property

Physical items with a material form.

Intangible property

Non-physical assets like goodwill or stock; rights and privileges.

Uniform Commercial Code (UCC)

Set of statutory laws governing commercial transactions; Article II covers sales of goods.

Express warranty

Specific terms the seller promises regarding quality or performance.

Implied warranty

Warranties imposed by law, not written in the contract.

Breach of contract

Failure to live up to contract promises.

Agency

A relationship where one party acts on behalf of another.

Principal

The party who hires the agent to accomplish a task.

Agent

The party who acts on behalf of the principal.

Power of attorney

A legal document authorizing an agent to act for another.

Counterfeiting

Producing or selling fake goods that imitate real brands.

Contract

Mutual agreement between two or more parties enforceable by law.

Seven Steps to Compliance (FSGO)

Seven steps to prevent misconduct: standards, appoint a compliance officer, avoid predisposed individuals, training, monitoring/auditing, enforce, respond to misconduct.

Sarbanes-Oxley Act (SOX)

2002 law criminalizing securities fraud and increasing corporate accountability.

Dodd-Frank Act

2010 law increasing consumer protection, transparency, and creating new agencies.

Whistleblowing

Exposing employer wrongdoing to outsiders or regulators.

Whistleblower bounty

SEC awards 10–30% of monetary penalties over $1 million to tipsters.

Federal Trade Commission (FTC)

U.S. agency enforcing consumer protection and antitrust laws.

Food and Drug Administration (FDA)

Agency enforcing regulations on foods, drugs, cosmetics, and medical devices.

Consumer Product Safety Commission (CPSC)

Agency focused on product safety; recalls and protections.

COPPA

Children’s Online Privacy Protection Act; restricts data collection from kids under 13.

Privacy/data protection

Safeguarding personal information; privacy laws and regulations.

Edelman Trust Barometer

Benchmark of public trust in institutions and industries.

Unemployment

Economic/ethical issue concerning job loss and workforce skills.

Climate change

Long-term changes in global temperatures due to emissions; central sustainability concern.

Green energy/renewable energy

Energy sources like solar, wind, and hydro that reduce carbon emissions.

Carbon emissions trading

Market-based system to reduce greenhouse gas emissions.

CLMRS (Child Labor Monitoring and Remediation System)

Supply-chain system to identify and address child labor in cocoa supply.

Consumer rights (John F. Kennedy)

Rights to safety, to be informed, to choose, and to be heard.

Counterfeiting punishment and IP protection

Legal measures to protect trademarks, copyrights, patents, and trade dress from infringement.

Digital privacy (internet regulation)

Regulations governing data collection, cookies, and online tracking.